As said previously, there is no point is setting your speed to 1/500 as the cameras sync speed is around 1/250 .
Isn't the X-sync speed on the 40D 1/250th? This means that 1/250th is the shorted duration you can use without there being a black band at the top and/or bottom of your image where the shutter wasn't fully open when the shutter fired.
The hi speed sync thing is lots of VERY short duration pulses of flash, rather than one flash, hence not freezing the image.
so basically hi speed sync is useful for fill flash on reletivley close subjects. If power is done to a third with hss then you will jsut have to take that into account.
I'm glad that someone showed me this - maybe this will help me to use the flash better!